The offer goes to owners of 482,000 cars, many of whom are angry at the company because they paid extra for the cars to be environmentally sensitive without losing peppy acceleration.

VW is working on a fix for the cars, which are equipped with software that turns on pollution controls during government tests and turns them off while on the road. The US Environmental Protection Agency says the cars, with two-litre, four-cylinder diesel engines, emit 10 to 40 times the allowable amount of harmful nitrogen oxide while being driven.

The offer also includes free roadside assistance for the diesel vehicles for three years.

"We are working tirelessly to develop an approved remedy for affected vehicles," Michael Horn, VW's US CEO, said.

"In the meantime we are providing this goodwill package as a first step towards regaining our customers' trust."

Meanwhile, Germany's transport ministry said yesterday that of the 2. 4 million vehicles being recalled for fixes in Germany, regulators "currently expect that approximately 540,000 will also need hardware changes" as well as software changes. It says Volkswagen will inform owners of the details.

The company is recalling 8.5 million 2009-2015 year cars with the software across Europe, starting next year. It says about 11 million cars worldwide have the software.

Also yesterday, Fitch, the credit ratings agency, downgraded Volkswagen's debt by two notches to reflect the potential financial costs of the scandal, as well as the management problems that led to the crisis in the first place.

Irish motorists seemed undeterred by the scandal and bought more new VW cars than any other make last month.

It is virtually certain the group will end up the biggest seller of all the marques for the full year.

New figures from the Central Statistics Office (CSO) show that Volkswagen was the most popular purchase, with 473 licensed, in October.

Some of these cars may have been pre-ordered, while a number may have been registered as sold in September but not licensed (taxed) until October.